Proof of Existence

Proof of existence

The Blockchain has a wide range of utilities and additional uses. In fact, the disruptive potential of this technology is so great that it is bound to change the way how we keep record of things and many more. It can be applied to virtually everything.

One of these uses is the chance to immutably record any document into the known public distributed ledger – The Blockchain. Proof of existence (PoE) has been here for a while and has become a pretty handy tool when it comes to public proof and authenticity of any record or document because even today, an email or a signed message sometimes might not be enough to prove something.

Proof of Existence is just taking the hash of something and storing that hash in the Blockchain. Since the Blockchain stores all of the transactions confirmed and all hashes are unique, once that transaction is confirmed, it can be referenced again to prove that a particular document exists.

Timestamping

Simply by a process of Blockchain registering and timestamping, PoE enables anyone to anonymously and securely store an online distributed proof of existence for any document. Documents are not stored in a centralized database or in the Bitcoin Blockchain, so all data stays private. All that is stored is a cryptographic digest of the file, linked to the time in which the document was submitted. This is an online service which allows people to publicly proving that certain information belongs to someone without revealing the data or owner, with a decentralized certification based on the Bitcoin network.

Contracts can be timestamped, along with digital signatures of both parties to prove when they were signed. Trusted timestamping allows proving you held a document, some information or a file at some specific point in time, in a way that can’t be forged. You can prove to have developed a specific revision of your software in a specific point in time by timestamping the hash of your revision tree. You’re not dependent on any single authority. Traditionally, trusted timestamps are issued by trusted third parties called TSAs (Time Stamping Authority), which are prone to data corruption and tampering. On the Bitcoin Blockchain, your timestamp is safely stored all over the world, and is much harder to tamper with.

Common uses for Proof of Existence

People can publicly reveal the digest and if conflict arises they can prove they had the data that generated the digest. Proof of Existence is useful for copyrighted material, patents, etc. A person can prove a certain data exists at a certain moment of time. As we use the Bitcoin Blockchain to store the document proof, anyone can certify the existence of a document without the need of a central authority. The computing power of the whole bitcoin network is used to certify your data.

Some of the common uses for PoE are:

Demonstrating data ownership without revealing actual data.

Document time stamping.

Proving ownership and Deed transfer

Asset realization

Checking for document integrity

If a person stores a proof for his document and later re-upload it, the system will only recognize it if it is completely and fully the same document. The slightest change and the Blockchain recognizes it is different. This gives the user the needed security that certified data can’t be changed.

Proof of Existence related projects:

There are a few projects on the cryptocurrency ecosystem dedicated to Proof of Existence. The list bellow includes some of the most important:

Technical foundations

It’s essentially a notary public service on the Internet, an inexpensive way of using Bitcoin’s distributed computing power to allow people to verify that a document existed at a certain point in time.

Algorithms can be used to create a digest, or a cryptographic string that is representative of a piece of data. The digest created by a hash function is based on the characteristics of a document. No two digests are the same, unless the data used to compute the digests is the same.

The document is certified via embedding its SHA256 digest in the Bitcoin Blockchain. This is done by generating a special Bitcoin transaction that encodes/contains the hash via an OP_RETURN script. This is a Bitcoin scripting opcode that marks the transaction output as provably un-spendable and allows a small amount of data to be inserted, which in our case is the document’s hash, plus a marker to identify all of our transactions.

It is possible to hash the data you wish to timestamp and turn it into a Bitcoin address. By making a small payment (a satoshi, or 0.00000001 BTC) to it, the payment is stored on the Blockchain along with the address you paid to.

Since only the hash is stored on the Bitcoin Blockchain, no one can tell what data you stored, but given the pre-hashed data you can prove the data was created prior to the block that contains the payment made to that address.

Once the transaction is confirmed, the document is permanently certified and proven to exist at least as early as the time the transaction was confirmed. If the document hadn’t existed at the time the transaction entered the Blockchain, it would have been impossible to embed its digest in the transaction. This is because of the hash function’s property of being second pre-image resistant. Embedding some hash and then adapting a future document to match the hash is also impossible. This is why once the Bitcoin Blockchain confirms the transaction generated for the document its existence is proven, permanently, with no trust required. The existence of a transaction in the Blockchain proves that the document existed at the time the transaction got included into a block.

Advantages of using the Bitcoin network

The key advantages are anonymity, privacy, and getting a decentralized proof which can’t be erased or modified by anyone such third parties or governments. Your document’s existence is permanently validated by the Blockchain even if this site is compromised or down, so you don’t depend or need to trust any central authority. All previous data times tamping solutions lack this freedom.

It’s anonymous. No one knows who you are, what data you’re timestamping, or even the fact that you’re timestamping anything.

It’s really cheap. At the current rates), including the transaction fees, it costs around 5 cents. You can make a transaction without fees, lowering the cost to $0.00000116, a fraction of a cent. However, it is highly recommended to pay the fees to support the miners who verify your timestamp with their computing resources.

Musicians and other digital art producers can prove when they created their work as well.

Before sharing ideas with third parties, entrepreneurs can timestamp the information that is about to be shared with them, as well as the fact that the information is being shared, to help resolve possible disputes.

There is an immense potential for further applications for the Blockchain, and right now many of these future applications are being developed to be implemented with the near “Internet of Things Revolution”. Proof of Existence will surely see its complete usefulness when that day comes.

NewsBTC is one of the largest online resources for Bitcoin and cryptocurrency news. Canada is a World renowned development hub for Bitcoin and FinTech advancements so extending NewsBTC specifically into Canada was a logical step. Having previously been involved in the earlier days of Bitcoin publishing significantly helped with my re-entry into the mix and it is thrilling to be a part of the NewsBTC family in representing Canadian FinTech.